Connected TV & Set Top Operating System Market Forecast 2023-2028
RDK crushed on global stage between rising Android TV and insurgent HarmonyOS, in 4.45 bn unit market
Huawei’s ambitions to become a global challenger to Android appear to have been completely neutered, since the last time that Rethink TV examined the operating system landscape of video devices. Specifically looking at the set top boxes of operators, as well as smart TVs and connected TV devices from retail sources, it is now clear that Android will achieve complete dominance over RDK on the global stage, with HarmonyOS confined to China. However, will that position, against the backdrop of a turning tide of sentiment for the Silicon Valley titans, lead to antitrust turmoil?
Betting on politicians is a fool’s errand, but the tension between Google’s Android ecosystem and the operators and video services that have been essentially forced into it is palpable. To this end, Huawei at one point did offer a chance of something different, but it has been so thoroughly beaten down by international sanctions that its limited role as a potential savior has been ground into dust. Consequently, HarmonyOS is essentially limited to APAC, where it will look significant on the global stage thanks to the size of its domestic market, but also make some entry into MENA and Latin America.
On the set top front, RDK’s hopes of expanding into Europe were dashed when Vodafone reneged on a commitment to the operating system, and turned instead to Android TV. Given Vodafone’s absorption of Liberty Global, this would have been a coup for RDK, but RDK Management, the organization promoting the operating system, does not discuss the ratio of the set tops (RDK-V) to broadband gateways (RDK-B), likely for good reason – as it would show that RDK is much more popular in WiFi CPE than in set tops.
For operators, the continuing decline of the pay TV customer footprint is an existential question, with the set top now viewed as mission-critical for controlling the customer relationship. The set top’s relevance to the consumer is waning, but the operators still cling to them, as vital devices for controlling the customer experience.
For the installed base of video devices, the period will see the continued decline of connected TV devices, as their functions are gradually replaced by new smart TV sales that directly integrate their features. Smartphones will continue to grow, and consumers will watch a greater proportion of video on these small screens.
For operators, the fear of second-screen viewing is nothing new, but they have always been able to bank on the need for a fixed broadband line as a way to keep their customers around. With the newest generation of consumers, even that safe bet might be slipping away, with these young users able and happy to consume all their content via a smartphone. There are signs that these consumers are even rejecting the foundational habit of googling, instead using search functions on YouTube and TikTok as their main discovery tool – a paradigm shift for the web industry to grapple with.
But returning to the present, and the installed base of video devices, it is apparent that the shipments of smart TVs and connected TV devices will continue apace – replacing older ‘dumb’ TVs through the period. However, it is worth noting that the shipments and therefore the installed base of CTV devices will also decline through the period, as those functions become natively available in new smart TVs.